Brand competition

Institution Definition

Intra-brand competition : Competition among distributors or retailers of the same branded product, be it on price or non-price terms. For example, a pair of Levi’s jeans may be sold at a lower price in a discount store as compared to a department store but often without the amenities in services that the latter provides. Inter-brand competition : Competition between firms that have developed brands or labels for their products in order to distinguish them from other brands sold in the same market segment. Although not perceived as being fully equivalent by consumers, branded products “nevertheless” compete with each other, but normally to a lesser degree. Coca-Cola versus Pepsi is an example of inter-brand competition. © European Commission

Intra-brand competition : Intra-brand competition is competition among retailers or distributors of the same brand. Intra-brand competition may be on price or non-price terms. As an example, a pair of Levi jeans may be sold at a lower price in a discount or specialty store as compared to a department store but without the amenities in services that a department store provides. The amenities in services constitute intra-brand non- price competition. Some manufacturers seek to maintain uniform retail prices for their products and prevent intra-brand price competition through business practices such as resale price maintenance (RPM), in order to stimulate intra-brand non- price competition if it will increase sales of their product. Inter-brand competition : Firms marketing differentiated products frequently develop and compete on the basis of brands or labels. Coca Cola vs. Pepsi-Cola, Levi vs. GWG jeans, Kellogg’s Corn Flakes vs. Nabisco’s Bran Flakes are a few examples of inter-brand competition. Each of these brands may be preferred by different buyers willing to pay a higher price or make more frequent purchases of one branded product over another. © OECD

Case Comments

Jean-Michel Vertut Proportionality: The Paris Court of Appeal nuances the consideration of the damage to the economy to preserve the proportionality of the penalty and by its ruling suggest to mind of this criterion in the light of the new article L. 464-2 I of the Commercial Code modified in the light of the ECN+ Directive (Distillerie Dillon et a. / Autorité de la Concurrence)

Facts. The case deals with the practice of exclusive import agreements in ultra marine territories, prohibited by Article L. 420-2-1 C. com. from the Law "Lurel" of November 20, 2012. The Court of Appeal ruled on an appeal by the wholesaler-importer in Martinique of a Champagne with a (...)

Michele Giannino The Italian Competition Authority closes with a commitment decision an investigation into a resale price maintenance arrangement affecting the market for nutritional supplements (Sofar / Fornitura Integratori Alimentari)

By its decision recently rendered in the Sofar/Fornitura Integratori Alimentari case the Italian Competition Authority (ICA) considered the lawfulness of the conducts of a supplier imposing minimum resale prices for the probiotic nutritional supplements. Pursuant to Article 14-ter of the (...)

Floris-Willem Dierickx, Andrzej Kmiecik The EU Court of Justice offers guidance on customer priority clauses in software distribution contracts by reaffirming fundamental principles regarding vertical restraints and intrabrand restrictions (Visma)

On 18 November 2021, the European Court of Justice (“ECJ” or “Court”) issued a preliminary ruling in a case referred by a Latvian court concerning the interpretation of Article 101(1) and (3) of the Treaty on the Functioning of the European Union (“TFEU”) in relation to a clause in a software (...)

Anne-Sophie Choné-Grimaldi Priority clause: The Court of Justice of the European Union answers a preliminary question asked by a Latvian court on the classification of a "priority clause" inserted in a distribution contract as a cartel, by recalling the alternative between the anti-competitive object and effects and the conditions for granting an individual exemption, without ever referring to the exemption regulation on vertical agreements (Visma Enterprise / Konkurences padome)

The Latvian competition authority was asked to review the validity of a "priority clause" in the distribution contracts between the manufacturer of an accounting software and its distributors. The priority mechanism worked as follows: the distributor who identified a potential customer had to (...)

Charlotte Colin-Dubuisson Distribution agreements: An overview of EU and national case law

Distribution agreements and competition law is a topic high on the agenda at the moment in Europe and beyond.

In this article, I would like to challenge a general comment that I often hear as a practitioner; that the enforcement of vertical restrictions mainly concerns the European Union (“EU”) – which, in my opinion, is only partly true. Indeed, undertakings face multiple local rules and a high enforcement level around the globe as illustrated by the number of vertical cases pursued by antitrust authorities over the past months. And, undertakings will also very soon face a second set of rules in Europe with the UK currently in the process of adopting standalone competition rules applicable to vertical agreements.

Antonio F. Dias, Christopher R.J. Pace, Eliot Pedrosa, Cristina Pérez Soto The US District Court for the Southern District of Florida rules that corporate-competitor plaintiffs may recover lost profits under the Florida Deceptive and Unfair Trade Practices Act (Tymar Distribution / Mitchell Group)

Southern District of Florida Finds Lost Profits Recoverable for Corporate-Competitor Plaintiffs Under FDUTPA The Chief Judge of the Southern District of Florida has ruled that corporate-competitor plaintiffs may recover lost profits under the Florida Deceptive and Unfair Trade Practices Act (...)

Alain Ronzano Intra-brand competition: The Paris Court of Appeal finds that the declarations of voluntary intervention and incidental appeal filed by the claimant against the decision of the French Competition Authority sanctioning an electronic products manufacturer and its two wholesalers to the tune of €1.24 billion for practices affecting ’intra-brand’ competition have lapsed (Apple / Tech Data / Ingram Micro)

On the same day, 11 February 2021, the same Chamber 5-7 of the Paris Court of Appeal adopted another judgment concerning this time the pending actions brought by Apple, Tech Data and Ingram Micro for annulment and, in the alternative, for reversal against decision No 20-D-04 of 16 March 2020 (...)

German Competition Authority The German Competition Authority clears online platform sales model of a brand’s competing brick-and-mortar retailers being allowed to sell on the same platform under the umbrella of the brand (Intersport)

Bundeskartellamt clears Intersport’s online platform sales model* The Bundeskartellamt has examined Intersport’s online platform sales model and has no objections under competition law. Based on the available information the Bundeskartellamt sees no need for an in-depth examination. (...)

Marcio da Silva Lima The German Competition Authority approves a sports retailer’s new online platform as it concerns only a small part of the retail market and will therefore hardly affect competition between retailers (Intersport)

Intersport, the world’s largest association of medium-sized retailers of sport products, switched its online sales platform operated by the Intersport subsidiary Intersport Digital GmbH (“IDG”) to a so-called "drop shipment business model". Although the Federal Cartel Office (“FCO”) found that (...)

Alain Ronzano Abuse of economic dependence: The French Competition Authority fines an electronics manufacturer and its two wholesalers €1.24 billion for practices affecting ’intra-brand’ competition (Apple / Tech Data / Ingram Micro)

It is recalled that in a decision No. 20-D-04 of March 16, 2020the Competition Authority has sanctioned Apple and its two wholesalers to the tune of... 1.24 billion euros !!! Excuse the little... And this record fine... just for practices affecting, it seems, mainly "intra-brand" competition (...)

Alexi Dimitriou The UK Court of Appeal upholds the Competition Authority’s decision finding that a golf equipment supplier acted illegally by banning online sales of its products (Ping)

On 21 January 2020, the Court of Appeal of England and Wales handed down a judgment dismissing the appeal by Ping Europe Limited ("Ping") against a judgment of the Competition Appeal Tribunal ("CAT"), upholding the CMA’s 2017 decision that Ping’s online sales ban constituted a restriction of (...)

Marie-Pierre Bonnet-Desplan Selective distribution : The Paris Court of Appeal confirms a sanction against a leader in garden machinery who imposed clauses restricting online sales to its distribution network (Stihl)

In 2018 (Decision No. 18-D-23 of 24 October 2018), the Competition Authority condemned Stihl and its parent company for having infringed the provisions of Articles 101 of the TFEU and 420-1 of the Commercial Code by restricting distance selling over the Internet from the sites of authorised (...)

Marie-Pierre Bonnet-Desplan Exclusive distribution: The Paris Court of Appeal considers that the online sale in local currency is not an active sale entailing an infringement of the contractual exclusivity of the local retailer (Trevinvest / Kaporal)

Few judicial decisions on this subject have been handed down, even though these situations are multiplying. A ready-to-wear brand had entrusted a local distributor with the exclusive distribution of its products for Switzerland. A distribution contract was signed in 2006 and terminated in 2015 (...)

Articles

Benjamin Schefer, Dieter Ahlert Vertical Price Coordination and Brand Care Interdisciplinary Perspectives on the Prohibition of Resale Price Maintenance, Dieter AHLERT and Benjamin SCHEFER

This section selects books on themes related to competition laws and economics. This compilation does not attempt to be exhaustive but rather a survey of themes important in the area. The survey usually covers publication over the last three months after publication of the latest issue of (...)

Mário Marques Mendes, Pablo Ibáñez Colomo, Luc Gyselen, Avantika Chowdhury, Mario Siragusa, Alice Setari, Inigo Igartua, Miguel Troncoso Ferrer, Nathalie Pétrignet, Vincent Lorieul The VBER and Vertical Guidelines: Revision or Reform? Reflection on critical issues

While the European Commission is exploring a possible revision of the VBER and of the Vertical Guidelines and assessing the various policy options proposed, this volume aims to reflect on some of the relevant issues and subjects in the VBER, some more controversial than others, but all having (...)

Jérôme Vidal Analysis of intra- and inter-brand competition in mergers within distribution networks: Review of the French Competition Authority’s decision-making practice in the retail sector

During the assessment of an acquisition by the head of the network of one of its members in the spring of 2018, in the food retail sector, the Autorité de la concurrence specified the manner in which it conducts the competitive analysis of this type of merger. Thus, even in the absence of a (...)

Patrick Rey, Thibaud Vergé Vertical restraints in European competition policy

This chapter focuses on the treatment of vertical restraints in European competition policy, which has put more emphasis on intra-brand competition, compared with what can be observed in other regions. The first part of the paper relates this emphasis to the objective of the European, namely, (...)

Events

Svend Albaek, Lucas Peeperkorn, Thibaud Vergé, Alexis Walckiers, Laurence Idot 12th New Frontiers of Antitrust #2 Vertical restrictions: VBER, everything changed?

2nd Webinar of the 12th « New Frontiers of Antitrust Conference » organised by Concurrences, in partnership with E.CA Economics, with Svend Albaek (Adviser - CET, DG COMP), Laurence Idot (Emeritus Professor, University Paris II Panthéon-Assas), Luc Peeperkorn (Professor, Brussels School of Competition | College of Europe), Thibaud Vergé (Professor, ENSAE | University of Bergen) and Alexis Walckiers (Director, E.CA Economics).

Books

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